How Much Does It Cost to Retire to Mexico?
Over a million Americans and half as many Canadians live in Mexico. Likely just as many live in the country part-time and unreported, keeping an address in the US (as I do). Living in Mexico is the answer for many who fear their lives will outlive their resources, especially given the costs of healthcare in the US. Many choose to retire earlier than they could otherwise by retiring to this far less expensive, gracious country. Those living on Social Security can still have a dignified life here.
Most expats will tell you that economic factors drove them to Mexico but that it’s the spirit of the Mexican people that keeps them here. Mexicans like Americans. They see us as generous, fair and optimistic. Older expats experience courtesy and patience that often seems to have disappeared in our country. English speaking expats bond together as a community and support one another. Even expats who aren’t great friends help one another, much the same way your community might support you if you lived in the same house for 40 years at home.
If there is one question that floods the space of every Facebook group associated with Mexico, it’s “How much does it cost to live there?” Mexico is a huge country. Like any country, the most popular places cost a little more. However in general a great rule of thumb is that your costs will be about half to maintain a lifestyle that roughly parallels what you have in the U.S. or Canada.
Housing - Rent or Own?
Below are two budgets, one for a single person and one for a couple who rent, taken from my book, The Mexico Solution: Saving your money, sanity and quality of life through part-time life in Mexico which gives you an idea of costs. The book’s examples include all kinds of lifestyle versions but the same 50%-less equation holds true in almost all of them.
Don and Barbara - Mérida (one of the most popular destination for expats)
Rent (upscale area, two bedroom apartment ) - $825
Food: $500 a month
Transportation: A gallon of gas costs around $3.50. At two 15-gallon tanks a month: $420
Internet: $35
Phone: U.S. plan - $100
Entertainment: Dinner for two, full courses @ $32 twice a month: $65
+ 2 tickets to the movies twice a month @ $3.50 a ticket = $15
Clothing: - $50 a month
Utilities: $60
Housekeeping: @ $20 (three hours) twice a month $40
Miscellaneous: $100
Total monthly expense: $2,010
Sally, a single woman living in Mazatlán
Rent: $850 a month (a two bedroom apartment in a very good neighborhood near the beach)
Food: $300 a month
Transportation: Uber (average one round-trip a day @ 45 pesos) $270
Internet: $40 a month
Phone service - $25 a month
Entertainment: $65 month (nice dinner and a drink three times a month)
Wine: @ 2 bottles a week - $70 a month
Clothing: $50 a month
Electric: $50 a month
Housekeeping: Twice a month @$25 a cleaning - $50
Entertaining at home: $100 (food and drink) a month
Miscellaneous. services: Netflix, online newspapers, online music subscription: $25 a month
Total: $1,845
Owning a home
Again, a good rule of thumb is that your home will cost about half that of a similar style home in the U.S. in a mid-sized city. The options can be particularly attractive for a single person, who can buy a small yet quite beautiful two bedroom house in a safe neighborhood for as little as $150,000. A French acquaintance recently bought such a home. It’s new, of modern style and includes a small private pool. In a country where a visit from a plumber costs $25 dollars, house maintenance costs are low.
For those who can’t see retirement without owning a home, prices can be a dream come true as long as you can purchase the house outright. You can’t finance a house in Mexico (mortgage interest rates are outrageous). The best idea is to rent a year or two and develop a good knowledge of neighborhoods and reputable realtors before you buy.
Healthcare in Mexico
Expat choose their healthcare plan according to a wide spread of factors. Options run the gamut and depend on budget, pre-existing conditions, comfort level with Mexican care and how often the expat returns home. You can choose private healthcare plans, government plans (if you acquire a Residents Visa) and expat insurance plans. Healthcare costs so much less in Mexico that healthy expats often pay their care out of pocket. Most medications are far less expensive, as are visits to specialists.
Unexpected savings, unexpected costs of life in Mexico
Everyone expects housing, food and healthcare to be much less expensive in Mexico. The lower costs I had never considered when planning to move here were personal services such as spa treatments, hair appointments, dinners out, housekeeping and other luxuries I’d cut back on in the U.S. In that respect, you might find that your life can include more indulgence on half the budget.
I’d be remiss if I didn’t mention certain extra expenses to consider. While plane fares to Mexico are low during the pandemic, they will not remain that way. You will likely need to budget in a few trips a year to the U.S.
I return to the US to see friends, harass my CPA and check in with the doctor I have had for 30 years. I also take the opportunity to purchase any electronics that need upgrading: cell phones, tablets, laptops, all of which are all more expensive in Mexico. Availability of foods has improved a great deal with the opening of Walmarts and Sams Clubs in larger cities. These stores and the arrival of Amazon (Amazon.mx) has increased the availability of just about everything you are used to having in the U.S.
Are people still moving to Mexico during the pandemic?
Mexico requires masks in retail stores and public places. Temperature readings and hand sanitizers are often provided upon entry. Mexico hasn’t imposed any legal restrictions on passengers or vehicles entering into Mexico by land or air from the United States (the U.S. has imposed restrictions on entering the U.S. from Mexico).
Chuck Bolotin, Vice President of Best Mexico Movers reports his business has doubled since this time last year. “Homes are selling very quickly in the U.S. People who plan to move to Mexico after their home sells don't want to wait. For many, life has become increasingly expensive and comparatively unpleasant compared to the how they could live in Mexico. Many Americans are simply ready for a slower, happier, less expensive lifestyle.”
Is Mexico for you?
The only way to know if Mexico, or any foreign country for that matter, is for you is to take an extended visit. Do your research on the many Facebook groups that exist for expats and those thinking about it. Read accounts and books by people who actually live in Mexico (that they live there is critical) and then hone that research down to the specific area that interests you. Don’t get overwhelmed by information you don’t yet need (like owning a car or visa processes). Concentrate only on what and who you need to know in order to take an extended visit.
Each popular expat area has a flavor, a feel. Some cities emphasize art and culture (San Miguel de Allende), some places are casual and beachy (Mérida, Puerto Vallarta), some soak in history and Mexican authenticity (Oaxaca, Cuernavaca). Read a few books, develop some online relationships and let your exploration begin!
Related Links:
The many cognitive bias that prevent people from considering Mexico as a logical retirement plan - Ventanas Mexico
Is Mexico safe? - Ventanas Mexico
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About the author:
Kerry Baker is the author of four books, The Interactive Guide to Learning Spanish Free Online {under revision], If Only I Had a Place, the complete guide to living in Mexico, The Mexico Solution: Saving your money, sanity and quality of life through part-time life in Mexico and The Lazy Expat: Healthy Recipes That Translate In Mexico. Trying to maintain a healthy diet in Mexico? You must cook, and you’ll need this book.